They Didn’t Think We’d Notice?

All I can say is that it doesn’t take a whole lot to raise your blood pressure about 50 points when you work in and around the trades show business any more. Here’s a great example of manipulating the calendar to generate big dollars for the trade show service contractors. This one is called the “artificial cut off date.”

What is that? Well, simply put, it means that the service contractor accepts freight at their advance warehouse usually beginning 30 days in advance of the move in date of the show. Normally, exhibitors can ship their freight to the warehouse, up to the service contractor’s move in date without any extra charge. Now that has changed, and the service contractor in Denver, Freeman

Shipping Crate

in this instance, now gives you 30 days, but they cut the service off at the normal rate “one week” before the exhibitor move in. Then, anything coming in during the last week is charged $16.25 per hundred weight with a minimum of 200 pounds, just for their inconvenience. Think about that. Who would suspect that if you can ship to this facility up to 30 days in advance and you schedule your freight to arrive a week in advance, that by doing so would be grounds for additional charges?

Now let’s be honest here. I was once a decorator a number of years ago and even subcontracted shows from Freeman, who is a very good, upstanding and reputable company, but in the  interest of maximizing every dollar generating opportunity they can, this one seems like a blatant attempt to chisel away at the exhibitor’s pocket-book in a very cheap way! I say that because intuitively, no one would suspect that they getting themselves into this type of situation by having their freight arrive 5 days before the show moves in.

Decorators normally don’t begin loading up the freight going to the show until a few days (depending on the size of the show) before their advance move in, and unless they are receiving the freight and putting the freight directly into a trailer that represents a specific geographic area on the show floor, they will use the advance time in the warehouse to segregate and batch the freight which is going into different areas on the show floor to allow for a more orderly move in. Therefore, receiving more advance freight up to the last-minute really doesn’t inconvenience their process much and alleviates what is normally a greater expense of receiving the freight at show site which is normally on a weekend which is obviously overtime.

What is gained by cutting off the regular advance warehouse rate off a week in advance? Money! At an additional $16.25 per hundred weight, if you calculate the amount of freight that normally comes in during the last week that the advance warehouse is open, this turns out to be very big dollars. But what about small shipments? Well, a small box is now charged an additional $32.50 per box if it arrives alone, on top of the existing drayage prices which might be as much as $90 or more per hundred weight with a minimum of 200 pounds. That little box get’s to be very valuable in a real hurry. It’s no wonder that more and more exhibitors are shipping directly to their hotels to avoid some of this.

I wrote this because the more you know, the more you and some of your clients can do to avoid a few of these very expensive pitfalls. But who’s to blame? Oddly enough it’s not the service contractors, but in my humble opinion,  the show managers who burden the service contractors with so many mandatory free bees that they have to resort to this type of behavior to exist. It’s just sort of sad when it becomes so blatant.

Go to www.shopforexhibits.com for more information on trade show displays.

by Lowell Nickens, ShopForExhibits.com LinkedIn Profile

When Pricing Really Gets Out of Wack!

I was just reflecting the other day on where the next round of price increases would take us; by that I mean, does the spiral ever end? Which way? Well, if for some of us the spiral goes up, then for the other it goes down.

Here’s the point. A week ago, I had a long time client tell me that he’d had enough. Specifically, he said that it costs more to move his trade show displays from the dock to his booth than to ship them across the entire country; so that meant a new booth for him that has fabric graphics and can be packaged in one or two at the most, flat panel molded shipping cases. You win; right? Well noooo….

Things aren’t always what they seem to be. In response to trade shows becoming less and less wood and more and more plastic, guess what? Yesssss! The drayage rates go up again, or the rules change and what you once shipped as standard freight, is now “special handling,” and it soon costs just as much as before and probably more.

Another good example is trade show electrical. This one is a great example because the spiral has been going up for enough years that you can actually see the insanity in it.  Here’s the progression:

• First we start with an exhibitor who purchases a 500 watt electrical outlet for his pop up lights and a small demo machine in the front of the booth.  Price is reasonable, we pay it, and we’re good to go. What you paid for is the sum total of all the electricity you need for your equipment. (in some cities, the electrician had to screw in the incandescent light bulbs but that was included)
• Now, the show contractor isn’t meeting their profit forecast so they increase prices by eliminating  the use of extension cords from all booths and make it mandatory that you plug into the electricians “electrical drop.” Now you have to order a 500 watt outlet for the front of the booth and one for the back of the booth. You still don’t use more than 500 watts, but you pay for 1,000.
• Because revenue and thus profits are falling from other revenue sources, the electricians have to not only charge for the power, but also for “labor” to install it. Are they doing anything more than what they’ve done for years? No, they just need more money and the good news for them is that they can charge for installing it and for UN installing it if there even is such a thing.
• Now it’s the exhibitors turn to strike back; you invest in LED lights because for each 200 watt light you now only use 24 watts of power and can finally save on the amount of electricity that you need for your booth.  Once again, life is good!
• The Empire Strikes Back! Not so fast on those savings Mr. Exhibitor! You really don’t know how to plug in a light properly without potentially inflicting damage to those around you, so the electricians will assist you for another $75-$100 per booth for each and every show they service. Do the math. Let’s say we have a 300 booth show times $100 minus direct labor to install those pesky pop up lights and they’ve had a pretty good day. Oh, you lose!

When is this all going to end? It won’t until a few people in the industry realize that the old business model isn’t what it used to be, and a new reality needs to be embraced so the industry can live the life span that it was meant to live. Profits just aren’t going to be what they used to be. I don’t really know what the net effect is going to be as prices keep spiraling up, but in my perspective, it has to be significant. I’m even seeing the small guys who have pop ups forgoing  the pleasure of using that product in favor of 3 banner stands lined up next to one another. That’s when you go from minimal exposure to the ridiculous!

Finally, I must say that it also has a lot to do with the union model of representing workers. If keeping your stewards job is always based on “what have you done for me lately” then is it any wonder that prices keep spiraling?

Go to www.shopforexhibits.com for more information on trade show displays.

by  Lowell Nickens, ShopForExhibits.com LinkedIn Profile

Growing Their Business at Your Expense – One Crate at a Time

The Scenario

A few years ago when I first noticed that G.E.S. Exposition Services had entered the "logistic" market, (by the way, that's a fancy name that UPS uses for "shipping") my first thought was good luck! What exhibitor who was exhibiting in any trade show would give their shipping business to the same company that just gouged them with sky high drayage rates and $180 per hour set up labor rate for installing their trade show displays? Well, in business, you sometimes find strange bedfellows, and in the trade show business, that's no exception. 

The Set Up

Well, if you can't get ahead coming in the front door, then there's always the back door which is the situation which I recently witnessed at a large trade show in Orlando, Florida. G.E.S. was the show contractor for the 400+ booth show which broke at 6pm on a Tuesday night with final move out no later than noon the following day.  As we all know, by the time your crates are returned from empty storage, on overtime no less, you've already lost half the evening, so we decided to begin the dismantle early the next morning with a large crew and be finished and out of the hall by noon. I scheduled the air freight carrier to be there by 10:30 a.m. so as not to impede the show contractors ability to clear the floor in any way. The show contractor had to be out by midnight on the second day of moveout. 

The Sting

I had all the bills of lading filled out and ready to go, but about 10:30 a.m.  I received a call from the air freight carrier telling me that their driver was being turned away at the marshalling yard check in point because he didn't show up at 8 a.m. that morning to sign in, which to me didn't make lick of sense because he wasn't going to begin loading until noon. I immediately went to the show service desk to find out why this was happening and learned the from the service manager that the 8 a.m. sign in time had been formally introduced into the show rules by "show management" and thus couldn't be altered in fairness to all the other exhibitors who had "played by the rules". There was obviously one show manager who'd been had by his service rep and probably didn't think anything of the request to establish that time. 

The Light Bulb Goes On

As I stood there reeling at how I'd just been given an old fashion Southern butt kicking, the logistics people smiled and kindly asked if I was interested in a completive rate to ship my 7 crates plus carpet to Boston? It didn't take but a millisecond for the light to go on in my mind about what was really happening here! Now I understood what the magic of the 8 a.m. check in time was. It was nothing less than a slick way to drive the competition away by forcing the competition to sit in the marshalling yard for 4 hours in the sweltering sun with the meter running, G.E.S. has effectively been able to cut their competitions profit margin in half and has eliminated another freight company from future competition. 

Now I guess that's what G.E.S. calls, good old fashion fun!

By Lowell Nickens, ShopForExhibits.com, LinkedIn Profile

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